Board Diversity Matrix template is applicable for all Nasdaq-listed companies that are now required to publicly disclose the diversity statistics as per the new Board Diversity Rule.
The Securities and Exchange Commission (SEC) has approved Nasdaq’s Board Diversity Rule. This was announced last month in an official document published here. As per the new rule, all Nasdaq-listed companies have to abide by a disclosure standard that has been approved by SEC as a step toward creating and encouraging board diversity within the board. This would allow stakeholders to gain information on a Nasdaq-listed company’s current board composition.
What is Board Diversity Rule?
The Board Diversity Rule is SEC-approved legislation for all Nasdaq-listed companies in the US, that requires the company to publicly disclose board-level diversity using a standardized template approved by the SEC. If the company fails to disclose diversity or has less than 2 diverse directors, SEC seeks an explanation for the laxity in meeting the board-level diversity standards. The companies have to list at least 2 female directors in a group of 5 or fewer directors so as to meet the diversity objective of the Board Diversity Rule.
The standard template is called the Board Diversity Matrix.
As part of an awareness program, Nasdaq would host series of webinars to help companies align their diversity benchmarks with the new rule and help them understand why variety across the board ensures participants have a fair diversity spread across their Board.
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